The dispersion-shifted fiber (DSF) incorporated with Si nanocrystals (Si-NCs) having highly nonlinear optical property was fabricated to investigate the effective supercontinuum generation characteristics by using the MCVD process and the drawing process. Optical nonlinearity was enhanced by incorporating Si nanocrystals in the core of the fiber and the refractive index profile of a dispersion-shifted fiber was employed to match its zero-dispersion wavelength to that of the commercially available pumping source for generating effective supercontinuum. The non-resonant nonlinear refractive index, n2, of the Si-NCs doped DSF measured by the cw-SPM method was measured to be 7.03 x 10(-20) [m2/W] and the coefficient of non-resonant nonlinearity, gamma, was 7.14 [W(-1) km(-1)]. To examine supercontinuum generation of the Si-NCs doped DSF, the femtosecond fiber laser with the pulse width of 150 fs (at 1560 nm) was launched into the fiber core. The output spectrum of the Si-NCs doped DSF was found to broaden from 1300 nm to wavelength well beyond 1700 nm, which can be attributed to the enhanced optical nonlinearity by Si-NCs embedded in the fiber core. The short wavelength of the supercontinuum spectrum in the Si-NCs doped DSF showed shift from 1352 nm to 1220 nm for the fiber length of 2.5 m and 200 m, respectively.